This is a Beginner's Basic Guide to Investing in Gold and Silver. As the dollar loses value, many investors are turning to precious metals, converting at least part of their investment portfolio from cash, equities and other assets into silver and gold in an attempt to preserve the value of their capital. This is why the price of gold has more than doubled since 2007. Similar to gold, silver has long been considered a safe investment, especially to hedge against inflation. Like gold, silver is a

Silver and GOLD PRICES rose sharply, anticipating the FOMC’s decision to continue gutting the US dollar. This was rational, and accorded with cause-and-effect. Silver closed up 49 cents to 2294.6 while gold rose $3.80 to $1,349. Gold actually hit $1,357, but then as soon as the FOMC announced, it fell to $1,343 ish and silver to 2268c. This was irrational.

No doubt 0.8 nanoseconds after the Fed’s announcement SOMEbody sold 2,500 futures contracts in silver and gold. No need even to look.

But forget all that — the fall may even have been natural. Much more important is the new low close for the move by the GOLD/SILVER RATIO at 58.790.

Behold! The GOLD PRICE remains above its $1,341.74 50 DMA and silver above its 2251c DMA. Lo! The MACD for both points up. Rate of Change for both is up and trending up.

Yet people are afraid to buy. I reckon they want to wait for confirmation at $1,400 ($50 higher) or $1,550 ($200 higher). Me, I’m already biting at them.

Travelling on 9 October, the day it was announced, I missed commenting on Janet Yellen’s nomination to be Head Criminal at the Federal Reserve. My first, well- reasoned response was, “Oh, ****!” But then, it comes as no surprise after Bernanke’s unprecedented money creation spree that O’Bama would appoint the most rabid inflationist around to serve as Co-ordinator of National and International Looting and Lying.

What doth this mean for us peasants? That the best friend gold and silver have is about to become Fed Head. Why best friend? Because only one thing drives a silver and gold bull market: Monetary Demand. And Monetary Demand is driven by central bank money printing, and the Printer in Chief is about to take charge.

Speaking of the Federal Reserve, the midgets of the FOMC met today and took their shaky hands off the controls. “We ain’t doing a THING!” they said, wary lest the shatter fragile markets. “We’re just a-gonna keep on creating $85 billion a month.”

As expected, the news announcement hit stocks upside the head and made ’em stumble. Gold rose going into the FOMC, but then fell off after the announcement. That, of course, makes no more sense than buying a tuxedo for a hog, but let’s ignore rational fastidiousness and look closer.

Now I don’t know a blasted thing, being just a barefoot natural born fool from Tennessee (and I tell y’all truly I have an attorney from Alabama who walked around in the courtroom in his stocking feet), but if I owned stocks I’d be puking in my wastebasket or sell it all. First, there’s that peaking margin debt, highest since 2007. Next are all those rising wedges on every index chart. Third, following the example of the S&P500, the Nasdaq Comp, Nasdaq 100, Russell 200, and Wilshire 5000 have all “thrown over” their upper trendline, and today backed off sharply.

At the very least, this leg has ended and stocks are in for a correction. Most indices posted first half of a Key Reversal today with a break into new high territory and a lower close. Another lower close tomorrow pounds nails into the coffin.

Dow dropped 61.59 (0.39%) to 15,618.76 while the S&P500 lost 8.64 (0.49%) to 1,763.31. Both Dow in Gold and Dow in Silver dropped below their 20 day moving averages.

Meanwhile, violating once again all reason and the law of cause and effect, the US dollar rose on the FOMC’s news that it intends to keep on depreciating the dollar for the foreseeable future. Gained 15.9 basis points to end at 79.767, up 0.2%. Gapped up on the news, by the way. Both the competitors, Yen and Euro, fell. Yen ended at 101.47 cents (-0.38%) while the euro lost only 0.06% to $1.3738.

Looking at a longer term chart, if the Dollar breaks 79.00, nothing stands ready to catch it before 73. But it appears to have made a little V-bottom with a low at 79.06, and has risen up to the trend line it last broke. That makes it “fish or cut bait” time for the dollar: it needs to rise through that line. More, it needs to prove it can get through 81 to offer any ground to believe it is not about to plunge.

On 30 October 1890 the US congress passed the Sherman Silver Purchase act. Since the Crime of 1873 when silver had been surreptitiously demonetized, worsening the post-war deflation, farmers and miners had been agitating for unlimited coinage of silver. This act, however, didn’t grant that. It increased how much silver the government purchased, and that did that with Treasury Coin notes redeemable in either silver or gold. People cashed the notes for gold, threatening the government’s gold reserve, so in 1893 the act was repealed. That’s why it’s fairly easy to find the Morgan silver dollars with dates from 1878 to 1892, but the 1893s are nearly impossible to find.

Do NOT use these commentaries to trade futures contracts. I don’t intend them for that or write them with that short term trading outlook. I write them for long-term investors in physical metals. Take them as entertainment, but not as a timing service for futures.

NOR do I recommend investing in gold or silver Exchange Trade Funds (ETFs). Those are NOT physical metal and I fear one day one or another may go up in smoke. Unless you can breathe smoke, stay away. Call me paranoid, but the surviving rabbit is wary of traps.

NOR do I recommend trading futures options or other leveraged paper gold and silver products. These are not for the inexperienced.

NOR do I recommend buying gold and silver on margin or with debt.

What DO I recommend? Physical gold and silver coins and bars in your own hands.

Silver and GOLD PRICES are languishing. Well, maybe the NGM have them languishing, since the Nice Government Men could hardly want silver and gold busting the roof when they announce they mean to keep on depreciating the dollar. The uptrend in the SILVER and GOLD PRICES that began 16 October remains in force.

Those blasted Federal Open Market Committee meetings cast a pall over everything. Today stocks shot up on the theory that the FOMC tomorrow will announce that it’s buying more monetary liquor for the party, i.e., not slowing down Quantitative Easing. This, they believe, will work wonders for the stock market.

Anyhow, we are back to the proverb, “Buy the rumor, sell the news.” Tomorrow comes the “news” and that may crack the stock market’s back for this short term move.

Dow Jones Industrial Average made a new high today at 15,680.35 vs. the 18 September high at 15,676.94. Hubba-hubba. Dow rose 111.42 or 0.72%. S&P500 rose 9.84 (0.5%) to 1,771.95. It has risen 9 of the last 10 days.

Folks, I’m nothing but a natural born fool from Tennessee who only wears shoes half the year, but even I know that this is NOT normal and will not go on forever. This doesn’t even take into consideration that the whole stock market is floating on a massive wave of newly created money. But shucks! Who am I, hick and ridge-runner, to put my conclusions up against the opinion of hundreds of shark-skin suit and pointy-toe shoe wearing Wall Streeters who hawk stocks for a living? Why, they’re bound to be objective, right? After all, they’re government regulated!

Do y’all ever think about what a sham, Potemkin world y’all live in? Everything is manipulated — markets, media, politics — to create an illusion of stability, prosperity, and participatory democracy. Do any of y’all really believe that hogwash? Talk is getting around on the Internet about the “Mystery Seller” coming in to the light trading hours of silver and gold futures selling two thousand or more contracts at a lick. No profit- maximizing seller in his right mind would do that. Therefore, the finger points to? Well, who has a motive to deceive?

US dollar index has been gaining this week. This is the sort of move that drives the rational mind to gibber and drool. All the news expected from the FOMC is that they will continue to create $85 billion of new money a month, which can only sepreciate the dollar, and in the teeth of that the dollar RISES? Well, it did. 28.7 basis points (0.37%) today to 79.631. Y’all can buy them nasty dollars if you want, but you’re just picking your own pocket. Dollar strength is almost as enduring as Hollywood chastity.

Continuing the offense against reason, the Euro fell 0.31% today to $1.3744, obviously expecting dollar strength — from alien tourists, I suppose. Yen dropped 0.56% to 101.85 cents/Y100, for what reason I haven’t a clue. I’ve stopped trying to parse why the Japanese do anything. At the rate their population is declining, who knows how long the yen will continue to be traded. Various reports say more adult diapers are being sold than children’s

in Japan. What does that mean?

I’ve already voiced my suspicions as to why silver and gold have slacked off this week. Today silver pared off 4.6 cents to 2245.2 while gold lost $6.80 to $1,345.20.

That takes silver barely below its 2252c 50 DMA. I don’t like that, but it’s a near thing. MACD, RSI, and Rate of Change are all positive for silver. Ditto for gold, but its 50 DMA stands at $1,342.30.

I reckon we simply have to endure this until the silly FOMC cloud passes.

Tonight I’ll appear on a webinar with Jason Matyas, who is working on the documentary, “Beyond Off the Grid.” At http://www.beyondoffgrid.com/webinars/how-to-build-your-local-economy-webinar/ you can sign up for the webinar. Starts at 8:00 Central time. We’ll be talking about why a US government default is inevitable, and how to rebuild your local economy.

Do NOT use these commentaries to trade futures contracts. I don’t intend them for that or write them with that short term trading outlook. I write them for long-term investors in physical metals. Take them as entertainment, but not as a timing service for futures.

NOR do I recommend investing in gold or silver Exchange Trade Funds (ETFs). Those are NOT physical metal and I fear one day one or another may go up in smoke. Unless you can breathe smoke, stay away. Call me paranoid, but the surviving rabbit is wary of traps.

NOR do I recommend trading futures options or other leveraged paper gold and silver products. These are not for the inexperienced.

NOR do I recommend buying gold and silver on margin or with debt.

What DO I recommend? Physical gold and silver coins and bars in your own hands.

Higher Gold Prices and Coin Sales Point to Growing Gold Rush
Gold prices in 2013 haven't performed as well as the previous few years – but Washington continues to give us plenty of reasons to buy the yellow metal. This week showed us how sensitive the price of gold can be to news from Washington. On the heels on …Read more on Money Morning

NGC Grades First 2014 Chinese Silver Panda Coins
It is estimated only 200 of the 2014-dated coins were released via an invitation-only ceremony at the Beijing Coin Expo on Friday, October 11, 2013, by China Gold Coin Incorporation (CGCI), the official distributor of precious metal coins for the …Read more on CoinNews.net

Today both silver and GOLD PRICES stalled. Gold lost 40 cents to $1,352 while silver lost 10.5 cents and ended 2249.8c.

Y’all know always to buy a rising market only, right? That must be correct because that’s what everybody does, only they wait until the market has already made a huge rise to do it. It’s human nature. They feel comfortable in a crowd, like lemmings.

The folks who make the money — the ones who look for oversold markets that offer real value — are vanishingly scarce. Human nature.

WHEREFORE, now while silver and GOLD PRICES, it seems, have finished their corrections, nobody wants to buy, so they will wait until gold has climbed from $1,350 to $1,900 so they can be “sure” it’s going to rise.

One other item: most likely, the Fed won’t taper. Not at all. None. Oh, I know they are rattling their tongues (their sharpest weapon) about tapering again. Fed took the Adjusted Monetary Base, the fuel for inflation, from about $850 billion in August 2008 to about $3.5 trillion lately. I am waiting for somebody to explain to me how, facing the present deflationary and depressionary headwinds, the fed will WITHDRAW high-powered money from the economy at all, or even taper off its monthly purchases (new money creation at an $85 bn monthly rate or $1.02 trillion yearly). More likely, in fact, is that the Fed INCREASES money creation, because they are now wed to the notion that money creation alone will fix the depression.

And while that inflation causes both poor and great to suffer, it drives silver and gold higher and higher. And it’s coming. It’s already baked into the cake, at least, that’s what Adjusted Monetary Base says.

Last week silver and gold prices performed just about perfectly. They jumped through two resistance levels on Monday, backed off Tuesday to the highest resistance, and Wednesday jumped to higher levels still. Gold jumped over its 50 day moving average (DMA), as did silver. Only silver’s weakness Friday marred the week.

Let’s realistically face the outcomes here. First, there remaineth the possibility of one further leg down, taking gold toward $1,200 and the SILVER PRICE toward $18. Seasonally both are moving out of the time when seasonality makes new lows likely. But until gold closes above its 200 DMA (now $1,432) and last peak $1,434, this possibility remains alive. Should it occur, it will mark a solid double bottom with the June low.

Second outcome is that I really am seeing upside-down head and shoulders patterns on both charts, which really are targeting $1,675 and $31.83. But first like all good runners, silver and gold must make it over the hurdles without tripping. Nearby silver must beat the 2300c mark that whipped it last week, although it has already better the last peak (2252c). I am most anxious to witness a close above 2355, then over 2512c, the August peak and the neckline. In between lies silver’s 200 DMA at 2427c.

In the same rally outcome, the gold price needs to rise above $1,376, then $1,400. Big leap comes at the August high of $1,434 and the 200 DMA ($1,432.77). The really clench it all down hurdle is $1,550, where gold broke down in April. However, technically momentum turns upward when gold closes over the 200 DMA.

Buttressing the case for higher gold and silver are the Dow in Gold and Dow in Silver. While stocks are making new highs, both indicators are falling, revealing the relative strength in metals. Dow in gold today closed roughly unchanged at 11.515 oz (G$238.05 gold dollars). Dow in Silver rose 3.15 oz (0.46%) to 692.01 oz. Trend favors metals, ’cause it’s down.

Stocks continue to levitate, but with a few bluebirds of unhappiness flying by. Dow Theory says that a new high in the Transports or Industrials needs to be confirmed by a new high in the other. Dow Industrials has stubbornly resisted making a new high while the S&P500 made daily new highs. The Dow Transports made 4 new highs in the last 5 days, while the Dow Industrials have not. Maybe the Industrials will catch up?

Dow fell 1.35 (0.01%) to 15,568.93 while the S&P500 rose 2.34 (0.13%) to a new high at 1,762.11. S&P500 has broken out above the upper trend line but the Dow laggeth onward. Meanwhile, margin debt has reached levels not seen since the 2007 peak. Does that mean anything?

US dollar index remains floating above 79, refusing to follow through on its breakdown. Closed today at 79.343, up 14.2 basis points (0.18%). Euro has risen to $1.3785, higher than last week but down 0.13% today. It’s only edging forward. Yen ended today at 102.38, down 0.30% and little changed in the last week.

Friends, Volume 2 of At Home In Dogwood Mudhole (Best Thing We Ever Did) is now available for preorder at www.dogwoodmudhole.com. It went to the printer today and we estimate it will be ready to ship the first week in December, in time for Christmas.

I must be crazy generous, but if you will use the discount code HOGWILD I will give you free shipping to US addresses, up to $6 (enough for 2 copies). Offer expires Sunday, 30 November 2013. Also, the PDF version will be available for sale and immediate download tomorrow, with Kindle and ePub editions coming in a few weeks.

Do NOT use these commentaries to trade futures contracts. I don’t intend them for that or write them with that short term trading outlook. I write them for long-term investors in physical metals. Take them as entertainment, but not as a timing service for futures.

NOR do I recommend investing in gold or silver Exchange Trade Funds (ETFs). Those are NOT physical metal and I fear one day one or another may go up in smoke. Unless you can breathe smoke, stay away. Call me paranoid, but the surviving rabbit is wary of traps.

NOR do I recommend trading futures options or other leveraged paper gold and silver products. These are not for the inexperienced.

NOR do I recommend buying gold and silver on margin or with debt.

What DO I recommend? Physical gold and silver coins and bars in your own hands.